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Citibank survey indicates shift in investment behavior among Hong Kong multimillionaires

EditorAmbhini Aishwarya
Published 11-10-2023, 04:38 pm
© Reuters.

A recent phone survey conducted by Citigroup (NYSE:C) reveals a slight drop in the number of multimillionaires residing in Hong Kong. As of June 2023, the count stands at 408,000 individuals, down from 410,000 in the previous year. The survey targeted Hong Kong citizens between the ages of 21 and 79.

The majority of these multimillionaires hold their assets primarily in cash (50%), followed by stocks (30%), funds (19%), and securities (3%). The median net asset value has seen a decrease of HK$500,000, dropping to HK$16 million (USD1 = HKD7.8194) compared to last year.

The study also uncovered aspects of family financial transparency among these wealthy individuals. Only 30% disclose personal wealth to their children, while a significant 90% share monthly expenses. These multimillionaires are willing to financially support their children's major life events and future needs such as home purchases (HK$2.4 million average), weddings (HK$380,000 average), and travel (HK$210,000 average). Interestingly, 40% of the children expect parental financial aid for raising their own offspring, with an anticipated contribution of HK$1 million on average.

In a separate summary by Citibank based on a survey of 1,700 Hong Kong residents, there is an indication of a decrease in multimillionaires from 515,000 in 2020 to 408,000 in 2021. This decrease is largely attributed to a 6% reduction in the Hong Kong property market and a substantial fall of 31% in the Hang Seng Index.

The study also highlights a shift in investment behavior among these wealthy individuals who possess assets of HK$10 million or more. Instead of holding cash, they are now investing more in stocks, funds, and particularly the US stock market. Anticipating a potential rate cut cycle, these individuals are reallocating their assets into mutual funds and fixed income investments to secure yields from the US Treasury or investment-grade bonds. They are also increasing their stake in the US big-cap through mutual funds, foreseeing potential benefits in 2024.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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